Currently, the estate tax in the U.S. is in a unique position. The code was written so that every year until 2009 the tax would lessen, until 2010, where it would disappear completely. However, next year, 2011, the estate tax will come back with a vengeance to a much higher level.
For a more in-depth breakdown, in 2011, the exclusion will only be $1 million and the tax rate will rise from 45% to 55%. Under the Estate Tax Law for 2009 which excluded the first $3.5 million and with a tax rate of 45% on anything above that, only about 3% of all estates paid any Estate Tax at all. And in 2010, there is no longer a “stepped up basis” on inherited assets: there is now a “carry over” basis. If you inherit anything at all before or after 2010, you receive a stepped up basis on the value of the asset so you don’t pay any Capital Gains Taxes. Read more here.
So, if someone has an elderly parent with a large estate and they die, usually the estate is taxed up to 50%. If this happens in 2010, that tax is zero. This of course creates some theoretical chaos, as those aware of this tax have an unpalatable inheritance incentive.
What does this loophole mean to you and what you could inherit over the next few years? Make an appointment Adam J. Tobin to better understand this tax code and figure out your next step. For a free consultation email Adam at atobin@adamtobinlaw.com or call 978-725-9083.
Friday, February 26, 2010
Elder lawyers are a great resource for planning your estate. An increasing amount of people are seeking advice on estate planning, and there is currently an intense discussion in Congress about an estate tax law. In her latest book, “Estate Planning Smarts”, Deborah L. Jacobs outlines the essential pieces you need to know when planning your estate.
A good estate plan should accomplish these goals:
• Caring for yourself by authorizing people to handle your affairs if you no longer can because of illness or disability
• Specifying who gets what after you pass away
• Providing for children who are minors or who have special needs.
Trusts play critical roles in estate planning, and can be used to hold money for minors, forestall spendthrift family members, protect assets from former spouses or creditors, or even make provisions to care for pets that survive you.
(Source: www.estateplanningsmarts.com)
See an elder lawyer like Adam J. Tobin, or one nearest you to get your estate plan in motion!
Filed in Elder Law, Elder Law Attorney, Estate Planning, Estate Planning Attorney, Estate Planning Lawyer, Estate Taxes, Massachusetts Elder Lawyer, Trusts
|
Tagged elder care lawyer, Estate Planning, estate tax, Estate Taxes, living trust, MA estate planning, Trust
|
Friday, February 19, 2010
Elder lawyers are great resources that can assist in dealing with the subsequent fallout to financial elder abuse. In a blog post dated September 2009, Janice Wallace brings up this unfortunate issue, specifically as it applies to finances. Wallace describes this abuse as “a person taking an elder’s money or property for his/her own needs,” and abusers can use any number of tactics ranging from threats of abandonment to guilt.
(Read the full article here: http://eldercareabcblog.com/protection-from-financial-elder-abuse/ )
As aging children and their parents find themselves in the inevitable role-reversal of care, it’s important to be aware of steps that can be taken to assure your parent, relative, or loved one never has to encounter this situation. It’s also important, yet disappointing, to note that most elder abuse is employed by a family member. Many of these instances go unreported as the elderly individual may feel ashamed that they cannot handle the abuse themselves, afraid of the abuser’s retaliation, or is concerned with being labeled as senile.
Keep an eye out for some of the warning signs:
- Sudden changes to a senior’s will
- Checks bounce when there should be adequate resources
- Unusual activities in bank accounts
(There is also a more thorough compilation of warning signs here: http://www.crimes-of-persuasion.com/Crimes/InPerson/MajorPerson/elder_abuse.htm)
And here are some preventative steps your loved ones can take to ensure elder financial abuse does not take place:
- Establish a relationship with the personnel at your bank
- Put all financial instructions in writing and be specific
- Keep accurate and complete financial records of all transactions
- Cultivate friends of all ages so you maintain a strong support network
- Never give out credit card numbers over the phone unless you placed the call
Stay involved in your loved one’s life, and if you still find that they have become a victim of elder abuse, be sure to seek out an elder lawyer such as Adam J. Tobin or one nearest you.
